A majority of UK consumers are expecting to abandon using cash for shopping in the next two years.
According to the report conducted by global payments provider Paysafe entitled 'Lost in Transaction', 55 per cent of UK shoppers are set to ditch cash, with 34 per cent visiting an ATM once a month or less. One in six even say that they rarely carry cash at all, rising to one in five for under 34s. Overall, 65 per cent of respondents said that they carry less cash than a year ago, making the move away from physicial notes and coins a sure thing to continue.
The study, undertaken in the UK, US and Canada, looks at attitudes to money and consumer buying behaviour, and examines how cash is merging with digital formats. It reveals increased consumer confidence in mobile shopping, the start of a shift to new payment methods such as cryptocurrencies and the potential for retailers to lose relevance without the right payment mix for customers.
It goes on to examine how the evolution of cash into digital formats is enabling consumers to move away from carrying hard currency, with a quarter (24 per cent) already adopting mobile wallets and 12 per cent using cryptocurrencies for payments. Contactless has paved the way for this new era of payments, with three out of five consumers regularly using it for payment, 69 per cent say that it is more convenient than cash, and 44 per cent stated taht they preferred to shop in places that take contactless. The mass acceptance of contactless is facilitating more compatibility between retailers and emerging payment methods at point-of-sale, including digital wallets and smartphone apps.
There are still concerns and hurdles to overcome however. 68 per cent of people worry about the security of contactless, and 58 per cent of consumers are concerned that they will be charged the wrong amount. There are also still worries around mobile wallets, with 29 per cent saying that they worried about their phones being stolen, while 28 per cent did not want to take their mobile phone out to pay. Despite these concerns, 63 per cent said that they are increasingly confident about using their mobile phone for shopping.
What's clear is that transactions are changing and effective retailers will have to step up in order to make growing trends towards digital wallets, contactless and cyptocurrency payments work in their stores.